Embodiments of the present invention are directed to systems, methods, and articles of manufacture for preparing an electronic tax return in which tax documents for a taxpayer are automatically accessed and converted into a standard data format to be imported into an electronic tax return thereby reducing the amount of user interaction required to prepare an electronic tax return while also reducing the amount of computing and network communication resources required.
Computerized (also referred to as “electronic”) tax return systems have become very popular and allow a user, such as a taxpayer or a tax professional, to prepare and electronically file a tax return using a computing device (e.g. personal computer, tablet computer, smart phone, etc.). The tax preparation systems typically comprise a computer system having an electronic tax return software application. The tax preparation system may be a desktop computer having a tax preparation application that resides and operates on the computer operated by the user or an online system having a tax preparation application that resides on a server that is accessible by the user's computer via a network such as the internet. The interface for a server based system can be an internet browser or specialized software residing on the local computer. There are a number of examples of desktop software applications and online tax preparation applications for preparing tax returns. Examples of desktop applications are TurboTax® software for Microsoft Windows® based personal computers (“PC”) and Apple® Mac® computers, Proseries® and Lacerte® tax preparation applications, which are known consumer and professional tax preparation applications available from Intuit Inc., Mountain View, Calif., H&R Block TaxCut software, available from H&R Block, Inc., Kansas City, Mo., and TaxACT® software available from 2nd Story Software, Inc. Examples of online tax return preparation applications are Turbotax® Online, H&R Block Online tax prep, and TaxACT® Online.
Whether a desktop system or an online system, the use of the application to prepare a computerized tax return is basically the same. For example, certain tax preparation applications present a list of tax-related questions or data entry fields to the user as a series of interview screens or fillable forms, in response to which the user enters the appropriate tax data and/or answers if they are known. For example, certain interview screens or questions may relate to personal and family information such as the user's social security number, marital status, number of dependents, etc. Other interview screens, questions and/or form field request tax data from tax documents related to the taxpayer's finances such as wages, retirement plan contributions, and social security, state and federal taxes that were paid or withheld, investments, deductible expenses and other tax deductions. This tax data is typically found on tax documents provided by employers, business entities and financial institutions, such as Form-W2 (employment income and other employment tax data), K-1 (tax data for partnerships, S corporations, estates and trusts), 1099-B (sales of securities, like stocks or mutual funds), 1099-DIV (dividends), 1099-MISC (independent contractor income), 1099-INT (interest income), 1099-MISC (miscellaneous income), 1098 (mortgage interest paid), etc.
Further, an electronic tax return may be a business or corporate return, and the tax data fields may, for example, relate to payments and benefits such as contributions to a retirement plan. Thus, data fields may relate to travel expenses or determinations of portions of expenses that are deductible.
Upon entry of all of the taxpayer data, the tax preparation system prepares an electronic tax return. The electronic tax return is then processed and formatted into an electronic tax return data file according to the requirements and specifications of the pertinent tax agency to which the tax return is being filed. Finally, the electronic tax return data file is filed with the appropriate tax authority such as the Internal Revenue Service (IRS), a state tax authority (e.g. California Franchise Tax Board), city tax authority, or other tax collecting agency, by transmitting the electronic tax return data file to the tax authority. Alternatively, the tax return data file can used to create a paper forms submission in which the tax return forms are printed and then submitted to the appropriate tax authority.
While these prior tax return preparation systems are useful, they do not have a comprehensive and automated means for accessing tax documents having tax data needed to prepare a tax return, and/or for automatically accessing updated tax documents when a tax document is corrected or changed. Consequently, although previous tax return preparation systems are widely used, they still require manually collecting and organizing tax documents and manually obtaining tax data from the tax documents for input into the computerized tax return preparation system. This results in significant time spent by a taxpayer and/or tax preparer even while using a computerized system, and also introduces significant chances of human error in the input of the tax data. Generating and displaying computer screens to allow for the manual input of tax data also increases the time and computing resources required to prepare an electronic tax return, and has other negative consequences, including user confusion, frustration and dissatisfaction with the tax return preparation system.
Accordingly, there is a need for improved computerized tax return preparation systems and methods which more fully automate the process of accessing tax documents and importing the tax data into a tax return.